With Citi's income falling 32% but beating some analysts expectations, what is your opinion on Citi Groups stock (C). Are they a buy and hold opportunity at 4.42?
I have a stock pile of cash I am looking to unload in the market in the near future.
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I am mad long C (like years) but I don't have crazy exposure. We shall see.
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C and BAC are the two most undervalued financials on a relative basis. If I were you, I would either use the cash to pay off student loans if you have them or blow the cash on something you want because the economy is going down the shitter and the financials will follow thanks to our incompetent government.
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Let them go through their 10:1 reverse split and drop back to $5 after it. Then it'll be a buy.
Can't imagine anyone going long a stock prior to a reverse split.
:(
The value of the securities must remain the same as they are currently on a per share basis, or so say the rules any way. So for citi to do a 10 to 1 reverse split the re released share vaulue must initially be $44.20, since they are removing 10 shares and replacing them with 1 new one that must be worth 10 times the value of the old stock. Now there is no telling what will happen after. The company is not allowed to dilute shareholder value when doing a stock split or reverse split. Now the markets are more then welcome to change shareholder value after it is done but the company it self can not do that.
So uh.. does anyone actually value companies anymore? Financials are really outside my circle of competence so I didn't buy any, but I did look at for a bit.
I've read a few write-ups on citi and it seemed interesting- lots of legit value guys with positions. Tried to figure out the downside. Loan loss reserves are just under 7% and they're starting to actually release those. Let's say they got really bad though- like 12%. At roughly $600 billion in loans and 12% default with no principal left, that's a loss of $70 billion. Current reserves are about $40 billion, so that leaves a $30 billion loss. 2010 pretax and preprovision income was just short of $40 billion, so that doesn't seem so bad for a worst-case.
ROA guidance was 1.25-1.5%, so if you start fooling around with different asset growth %s, it is looking cheap based on a forward earnings multiple..
Obviously not an in-depth analysis - people might have a different view on what their loan losses should actually look like, ROA and asset growth, etc. - but those are the questions you should be asking, not how the stock split will affect it....
As much I like all the loans data and value proposition.
Till Dodd-Frank is implemented and all the new rules/guidelines arrive. I am not sure 100% if I truly believe the shit Citi is selling. I am not even sure if I totally believe their accounting and financials, seems every 3 months we find out they restated something or used some trick to boost some asset pool.
If your going to own a financial why not just own, JPM? If you believe in the medium-term financials will rally and do well. Or GS.
now is not the time to buy a bank stock....
The same question can be asked for BoA today.
Well, it must be said that it is rarely popular to buy ANYTHING when it appears that the price is down. Otherwise the price wouldn't be down...
Besides, would you rather buy only after you witness a major recovery? It's all timing and relative value.
I'm going long financials with a 10 year horizon...
LOL this thread is fucking amazing! Why are people trying to buy stocks after a multi year QE induced rally, let alone bank stocks?! When QE ends later this month interest rates WILL spike. Good god at least wait till demand clears out and QE3 is mentioned, then buy. It doesn't take a genius to figure markets out.
I'm bullish on QE9
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